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The Raging Septuagenarian

The spectacular failure of News Corp.’s Internet businesses tainted James in the eyes of company executives, who naturally wanted to find fault in Rupert’s insistence on continuing the Murdoch dynasty. In May 2000, James headed to Hong Kong to run Star TV, Murdoch’s fledgling Asian pay-television service. Rupert appointed Lachlan to be deputy chief operating officer of News Corp., a move everyone recognized as evidence of Lachlan’s unrivaled status. James expressed resentment that Lachlan had been the anointed one, and he worked to make it clear that he was the smartest of the three children. At board meetings, James and Lachlan got into arguments over business decisions. “There was always banter going on,” a former senior News Corp. executive recalls. James, the sharper debater, could be arrogant and profane, peppering his declarations with “fuck,” much to his mother Anna’s dismay.

The brothers had always been fiercely competitive. Lachlan was the outgoing son, more like Anna. James, people thought, was much more like Rupert: an introvert. When Rupert married Wendi Deng only seventeen days after divorcing Anna in 1999, it was James who played conciliator, shuttling between parents. Lachlan sided with Anna.

When James arrived at Star, the perception among the senior executives, according to one senior employee, was that he needed to be rehabilitated after the Internet’s bust. “The feeling was James was the mistake maker,” a former senior Star executive remembers. “We felt Daddy needed something for him to do. He was the poor second son, and this is going to be a nightmare.”

Whatever lingering resentments remained, James swallowed his ego and worked to learn the television business. During his early weeks on the job, he went around to meet as many executives as he could and asked detailed questions. But as much as he reached out to his team, James kept his staff at a distance. His brother, Lachlan, was known as a gregarious boss. At the New York Post, where he was publisher, Lachlan was a popular figure in the newsroom. In Hong Kong, James never warmed to the public side of his job. “He’s cool to the point of cold,” one former News Corp. executive says.

In 2003, James left Star and became CEO of BSkyB. The appointment was controversial—James was only 30 at the time—but James again demonstrated his resolve. At BSkyB, his business instincts emerged. Like his father, he could make gut decisions and seemed to relish provocation. But James’s smartest maneuverings were directed at his own rise within News Corp. For the past decade, James has remained on the outer reaches of News Corp.’s empire, leaving Murdoch’s power base in New York unchallenged. He stayed out of the press and reportedly told his PR adviser that he would be successful at his job when people began referring to him as the “reclusive James Murdoch.” “He saw the risk of hanging out next to his dad in New York,” a person close to James says. James astutely avoided Ailes and Peter Chernin, who both maintained significant power centers of their own and were responsible for driving Lachlan from the company. When Lachlan quit, James absorbed the message. “James played it so right,” a former senior News Corp. executive says. “He had left the country, and he established himself.”

James differs from his father in significant ways. For starters, he has an M.B.A.-style view of management. As part of this corporate sensibility, James is attuned to News Corp.’s image and cares deeply how the company is perceived—it bothers him that it is seen as downscale and predatory. During the Journal acquisition, James reportedly told his father to pull out of the deal because of all the negative press. Part of this is James’s sensitivity. But as a would-be inheritor to the throne, James needs News Corp. to be respected by Wall Street. The Murdoch-family trust controls 38 percent of News Corp.’s voting shares. For it to remain in control, the company needs to be perceived as a professionally managed concern.

Roger Ailes is another complication for James. In Europe, where James spends much of his time, Ailes and Fox News are mocked and loathed as the worst form of American jingoism. James is concerned about climate change, and his wife, Kathryn, a former model and marketing executive, works for the Clinton Foundation. Politically, James is not liberal—he’s a committed free-market thinker—but Fox’s brand of politics is a problem that, in his view, needs to be managed.

James ultimately came to see Rupert’s purchase of the Journal as an opportunity: It would be a retirement project for his father. The paper’s prestige would help News Corp., and Rupert’s devotion to it would allow James to gain a more central role at News Corp. Indeed, a week before the Journal deal closed, James was promoted to run all of News Corp.’s businesses outside the United States.

“When they were doing the Journal deal, the children looked at it, especially James looked at it, as a way to deflect Murdoch’s attention,” says Michael Wolff, who wrote a book, The Man Who Owns the News, about Murdoch. The book, based on hours of interviews with Murdoch and many of his lieutenants, itself became a flashpoint within News Corp. Over nearly a decade, Gary Ginsberg, a member of News Corp.’s inner circle and Murdoch’s communications adviser, had worked tirelessly to soften and massage Murdoch’s image and had done a remarkable job of making News Corp., if not exactly admired, then palatable to a certain swath of Manhattan and Wall Street. In October 2007, Ginsberg, a former lawyer for the Clinton White House, was promoted to run global marketing for News Corp.